Lower Social Security Payroll Tax—Opportunity To Save More!
The federal government has reduced the Social Security payroll tax from 6.2% to 4.2%. This means that in 2011, and through the end of February 2012, you will see an additional 2% in every paycheck. And those extra earnings can enable you to save more for your child’s education.
Here’s an example:
With the tax decrease, a couple with a combined income of $60,000 will receive an extra $1,200 in take-home pay in 2011. They decide to redirect these additional funds into the CollegeCounts 529 Fund account they have just opened for their newborn.
Because of this decision, the family will benefit from:
- An Alabama state income tax deduction.1
- Tax-deferred growth.
- The potential for an additional $4,100 for their child’s college education.2
Increase your savings today!
College will be here before you know it. This is one more way you can help your child take full advantage of tomorrow’s opportunities. Call us or select an option below to start your automatic investment plan or to increase your current automatic investment plan today.
1A deduction, not to exceed $5,000 per taxpayer, is allowed as an adjustment to income on the Alabama income tax return for contributions made to the CollegeCounts 529 Fund or the PACT Program. The deduction may equal an amount up to $10,000 for married taxpayers filing a joint return where both taxpayers are making such contributions into the CollegeCounts 529 Fund or the PACT Program (closed to new investors).
2Amount based on a $100 monthly investment for 12 months, 7% earnings rate compounded over 18 years from birth to assumed college start date.
The CollegeCounts 529 Fund is a qualified tuition program under Section 529 of the Internal Revenue Code that is sponsored by the State of Alabama and administered by the Board of Trustees of the ACES Trust Fund (the “Trust” and plan issuer). Union Bank & Trust Company serves as Program Manager. Accounts and investments under the CollegeCounts 529 Fund are not insured or guaranteed by the FDIC, the State of Alabama, the State Treasurer of Alabama, the Board, the Trust, the Program, Union Bank & Trust Company, or any other entity.
Before investing, you should consider the investment objectives, risks, fees, expenses, and tax consequences associated with the Program. All of this information is contained in the Program Disclosure Statement. Please read it carefully before investing.
If you or your beneficiary is not an Alabama resident, consider whether your home state or the home state of your designated beneficiary offers a qualified tuition program that provides a state tax deduction or other benefits to residents who invest in that program.
Not FDIC Insured. No Bank Guarantee.May Lose Value.